04-26-2018 09:13 AM
Heighway Pinball, the pinball design and manufacturing business based in Ebbw Vale in South Wales, is facing liquidation.

The Heighway Pinball factory in Ebbw Vale, South Wales The four Directors of the company – Mats Daniel Janson (a.k.a. Daniel Janson), Cato Paus Skrede, Alexander Thomas Spohr, Johan Patrik Tenn (a.k.a. Patrik Tenn) – who also formed the Pinball Brothers company, have today called a meeting of creditors of the company with the intention of appointing a liquidator.

A liquidator will assess all the company’s assets and liabilities, and attempt to sell those assets in order to realise their maximum value.

NOTICE IS HEREBY GIVEN that the directors of the company are convening a virtual meeting of creditors to be held on 4 May 2018 at 11.30 am, for the purpose of deciding on the nomination of a liquidator.

In order to be entitled to vote creditors must deliver proxies and proofs to 11 Roman Way Business Centre, Berry Hill, Droitwich, Worcestershire WR9 9AJ by 12 noon on the business day before the day of the meeting.

NOTE: the meeting may be suspended or adjourned by the chair of the meeting (and must be adjourned if it is so resolved at the meeting).

Further information about this case is available from Mark Hunt at the offices of MB Insolvency on 01905 776 771 or at markhunt@mb-i.co.uk

It is not clear yet whether this is a Members Voluntary Liquidation (MVL) in which the proceeds of the sale of the assets would go to the owners of Heighway Pinball, or a Creditors’ Voluntary Liquidation (CVL) in which it is the creditors who receive the proceeds. If Heighway Pinball is solvent (i.e. its assets exceed its liabilities) then it would probably be an MVL, but if the liabilities exceed the assets (as would seem likely in this instance), then it would be a CVL.

If it does prove to be the latter, then it is often the case that the value of the assets is significantly less than the liabilities, meaning creditors get either only a partial payment on their owed debt, or none at all. Those creditors will likely include everyone who paid a pre-order deposit or handed over the full cost directly to Heighway Pinball without receiving their game, parts suppliers owed payment, distributors owed games, parts or refunds, the landlord of the factory, and of course HM Revenue & Customs (the UK’s tax authority) who will receive priority in any liquidation pay-out.

The future of Heighway Pinball has seemed in doubt for some time. Founded in 2012 by Andrew Heighway at his home in Merthyr Tydfill in South Wales, the company soon moved into their first factory unit and built the Bacardi Baffle Ball game which provided operating capital to help develop their first full-size pinball. That started out as Circe’s Animal House but was later rethemed before production to become Full Throttle. Sales were limited which meant, as they moved to a second factory, that the future of the company rested on the success of their second title, the much-anticipated Alien.

Delays due to design changes, the non-availability of parts and problems with the mechanical devices meant the game was late to market and suffered reliability issues. Spares and support were both hard to come by, and the money from game sales and pre-orders began to run out. New investors were brought in – including, but not limited to, the current Directors – and the company moved again to a newer, better-equipped factory in Ebbw Vale. Staff turnover at Heighway Pinball had always been relatively high, but the move 20 miles from the original base further accelerated the flow of key team members out of the business.

In June last year, Andrew himself left the business he began, handing it over to the team of investors to try to get the finances and the company’s reputation back on track. While there were promises to rebuild customers’ trust and be far more communicative, those both soon faded as information and support both dried up.

While a trickle of Alien games was leaving the factory, ultimately the sales numbers were too low to make the business a viable operation in its current form, and the investors have apparently decided to pull the plug.

The exact state of the company’s finances will become clearer at the meeting on 4th May, but it is of note that the Directors intend to apply for insolvency rather than the more common route of administration, where an Administrator is appointed to try to turn the company around or sell it as a going concern. Maybe the Directors believe they have done all they reasonably could to save the business.

Whether a new company will be formed to realise Heighway Pinball’s potential and capitalise on the designs, licences and assets they had built-up for their future games, we will have to wait and see, but this does seem like the final nail in the coffin for Heighway Pinball as we know it.

Pinball News will keep you informed about the outcome of that meeting and any additional details we uncover. We did contact the Directors and investors of Heighway Pinball to ask for their comments but have received no reply so far. If that changes we will update this article accordingly.

I don't quite understand why so many people seem to like throwing money at these ventures.

I mean, even when you have a smoothly-running operation staffed by long-time professionals, it seems like there's still a constant doubt as to how long it will all last. The pressure not to make mistakes (like in production and support), to create popular tables, and to retain key people is real. Meanwhile you're competing against Stern, as well as several other startups who no doubt think they can bring new insights and probably new methodologies in to the field.

So yeah, I get doing this out of love, but you're also throwing away vacation and retirement money and that sort of thing at the least. You're also probably guaranteeing yourself a variety of headaches in both the short and long term. Now I realise that's painting with kind of a broad brush, but there's got to be at least some of that pain no matter if you're one of the principles, investors who care, or one of the commercial partners and/or creditors. Even an operator or a home buyer is essentially an investor.

*shrug*

By comparison, virtual pinball seems like a far safer risk while still involving a strong level of creativity. Really, I'm a little surprised that more top-notch virtual tables (like ProPinball and some of the Zen games) aren't licensed to production companies more often... or even at all. Instead, these startups seem to prefer taking on enormous risk by designing their own games... often having to pay various licensing fees, anyway.

So maybe significant hubris is also a big player.

Now on Reddit, Andrew Heighway seems to get mentioned a lot as a slick-talking scam artist. So maybe there's a solid Trump angle as well, so to speak. As in, some investors like to dream and get excited about doing big things and/or pioneering things with their money. That almost begs for the entrance of someone who's talented at stoking those urges. But when you get really stoked, you have much less desire to fact check and to reality check. So the wheel keeps turning.